Fee for Future Mortgage Releases-County Clerk

Answered by:

Question:

Our bank collects a fee for future mortgage releases. Even though at closing the fee goes to us, eventually it is paid to the county clerk when we release the mortgage. For the purpose of the Loan Estimate and the Closing Disclosure is this fee considered paid to the Lender or to the County Clerk? Either way it would still be a 10% Tolerance category correct? If it is paid to the lender would that mean it needs to be included in the finance charge that affects the APR for calculating HOEPA?

Answer:

If you are not holding these funds in a dedicated account for future use (some sort of escrow account) it is nothing more than a lender origination fee, a finance charge, and would be disclosed in Section A with a zero tolerance.